The industrial real estate market in Vietnam still has significant development potential.

JLL: The industrial real estate market in Vietnam still has significant growth potential.

This was the statement made by Tom Over, Director of Transportation and Industrial at JLL Vietnam Asia Pacific , at the Vietnam Industrial Real Estate Forum 2024 organized by Investment Newspaper, currently taking place in Ho Chi Minh City.

Sharing an overview of Vietnam's industrial real estate market, Mr. Tom Over stated that in 2023, when GDP growth was low and exports decreased by 13%, and power outages continued to occur, some industrial zones were impacted. However, currently, Vietnam's GDP has recovered, and exports increased by 15% in the first six months of 2024.

Mr. Tom Over, Director of Transportation and Industrial at JLL Vietnam Asia Pacific . (Photo: Le Toan)

Regarding foreign investment, Vietnam is one of the standout countries in the region. In the South, land prices are slightly higher, with a 5% growth in 2023.

Specifically, in the North, rental prices are around $130, up 6%. The lowest price is $85, and the highest is $175. The occupancy rate is approximately 78.3%. Meanwhile, in the South, rental prices range around $160, up 5%. The lowest price is $100, and the highest is approximately $186. The occupancy rate is approximately 87.1%.

However, some concerns remain among FDI businesses. JLL experts say that Vietnam, Thailand, and Malaysia are three countries favored by investors, with Vietnam offering the most opportunities. However, some investors choose Thailand and Malaysia because they offer greater clarity regarding investor incentives, as well as easier licensing and a reliable labor force.

According to JLL's research, some developers in Vietnam focus entirely on factories, while others focus on warehouses. Some warehouse supply is shifting towards factory space… This shift is driven by market demand.

Supply and occupancy rates are high, exceeding 90% in stable areas compared to other areas. Supply is under construction, the overall market, and optimal and stable warehouse occupancy rates are also increasing significantly. The micro-market is showing strong growth.

"For warehouses, occupancy rates have been close to 100% over the past 18 months, despite challenges in domestic consumption. With FDI inflows, we've also seen better results across all sectors," said Tom Over.

Overview of the Vietnam Industrial Real Estate Forum 2024. (Photo: Le Toan)

Regarding green projects, industrial parks account for the largest proportion. At the same time, it's evident that developers are seeking alternative solutions, and green certification programs remain quite limited. This presents an opportunity for further development.

In 2023, among LEED-certified projects, 71% were industrial and logistics parks; 21% were offices; 7% were hospitals; and the remainder were education , residential, and retail.

The project is EDGE certified, with 38% dedicated to industrial and logistics zones; 16% to residential areas; 13% to offices; 9% to education; 9% to hospitals; and 6% to retail.

In terms of warehouse space, while there were only about 8.1 million square meters in 2019, this figure reached 14.1 million square meters in 2023. This shows that the Vietnamese industrial real estate market still has significant potential. Furthermore, the number of organizations participating in the market is also increasing.

“I have confidence in Vietnam’s development compared to last year. We have many opportunities for growth. The figures here show that the Vietnamese market is developing significantly, especially with a lot of capital flowing in. My overall message is that the journey is still very long and we are only at the beginning,” Mr. Tom Over emphasized.

Source: https://baodautu.vn/batdongsan/jll-thi-truong-bat-dong-san-cong-nghiep-tai-viet-nam-con-nhieu-tiem-nang-phat-trien-d221128.html